Joint Borrower Sole Proprietor Mortgage on a New Build
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Joint Borrower Sole Proprietor Mortgage on a New Build
Sam Bull talks about Joint Borrower Sole Proprietor (JBSP) mortgages on new build property.
Can I get a Joint Borrower Sole Proprietor mortgage on a new build?
Yes. The good news is that plenty of mortgage lenders are happy to lend to applicants buying a new build on a Joint Borrower Sole Proprietor basis.
Can I get a JBSP mortgage on a new build as a First Time Buyer?
Yes. Again, plenty of mortgage lenders are happy to lend to First Time Buyers who are looking to buy a new build using a JBSP mortgage. This will allow First Time Buyers to borrow more than they would have done otherwise.
What criteria do you need to meet for a JBSP mortgage for a new build?
Mortgage lenders all have their own individual lending criteria to qualify for a Joint Borrower Sole Proprietor mortgage. However, there are some general points that are worth considering.
There must be at least one proprietor or legal owner to the property, and usually at least one joint borrower. This person can be named on the mortgage to increase the amount that you can borrow, but they are not proprietors or legal owners.
Most mortgage lenders require the joint borrower to be immediate family members of the purchaser, such as parents, children or siblings. All applicants will typically need to pass the lender’s credit check. All applicants’ expenditure will be taken into account when assessing how much they can borrow.
Do JBSP mortgages require a larger deposit for new build properties compared to standard mortgages?
The deposit level required for a JBSP mortgage on a new build will be based on the lender’s standard lending policy for new builds.
This will vary depending on if you’re buying a new build house or a new build flat. Most mortgage lenders are going to require a minimum of 10% deposit.
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Do you pay stamp duty on a JBSP mortgage for a new build property?
The stamp duty will be paid as normal, and it will be based on the proprietor who will legally own the property. The joint borrowers named on the mortgage are not legal owners of the property, and therefore they will not be liable for the stamp duty. This is important, as it means there’s no second property stamp duty if they already own properties in their name.
Can I get a JBSP mortgage with my parents on a new build? Is there an age limit?
Yes, mortgage lenders are happy for an applicant’s parents to act as the joint borrowers to buy a new build home. Age restrictions do apply, and most mortgage lenders need the mortgage to end by the eldest applicant’s 80th birthday.
However, some mortgage lenders don’t have any upper age restrictions. This will just depend on the lender that we look to proceed with.
Are there any additional fees or costs associated with taking out a JBSP mortgage on a new build?
The good news is that there are no additional fees associated with taking out a JBSP mortgage on a new build. It’s just the normal fees that will apply, such as a valuation fee and a lender’s product fee. Those are the usual lender fees.
Can I switch from a standard mortgage on a new build property to a JBSP mortgage?
If you wanted to switch from a standard mortgage application on a new build to a JBSP, the standard application would need to be cancelled and a new application submitted on a JBSP basis. We wouldn’t switch it over, we’d cancel the first application and start a brand new one.
How do interest rates compare for JBSP mortgages on new builds?
Some mortgage lenders are happy to lend to applicants wanting to buy a new build on a JBSP basis as part of their standard new build product range. Other mortgage lenders have a specific product range for JBSP, which potentially could have slightly higher rates. So, again, this will just depend on the lender we proceed with.
What else do we need to know about a JBSP mortgage on a new build?
These types of mortgage applications are slightly more specialist, so I would suggest always working with a good mortgage broker who’s used to dealing with these types of applications.
That way, you’ll have access to all the different lenders who offer this type of product. Hopefully that means you’ll find the product available for your individual circumstance.
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